Microsoft to Acquire 3-D Chipmaker, Price Unknown

SUNNYVALE, Calif. (AP) -- Canesta Inc., which makes 3-D imaging chips, has agreed to be bought by Microsoft Corporation for an undisclosed amount.

The deal announced Friday comes less than a week before Microsoft is set to start selling Kinect, an add-on for Xbox 360 that can interpret players' body movements, using them to control what happens in the game. Kinect will allow people to play video games without having to mash buttons on a plastic controller.

Redmond, Wash.-based Microsoft worked with another 3-D sensor company, PrimeSense, in building Kinect. It had also acquired 3DV, a PrimeSense competitor, but did not end up using its technology.

Canesta, based in Sunnyvale, said the acquisition is expected to close before the end of the year.